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Business Groups Withholding TPP Support on Lack of Details

October 16, 2015

Major U.S. business groups, citing internal frictions and uncertainty over the details of President Barack Obama’s 12-nation Pacific trade deal, are withholding their support for now, hobbling the administration’s early efforts to win congressional backing.

With big pharmaceutical companies and several other major industries disappointed by the Trans-Pacific Partnership, the broader business coalitions that have long backed the talks say they first must consult with their members.

Major groups now on the fence include the U.S. Chamber of Commerce, the National Association of Manufacturers and the Business Roundtable.

“The expectation is that this is something that we’re going to be able to support, but it would probably be good to get the details out and take a look at those,” said John Engler, the former Michigan governor who leads the Business Roundtable, which includes U.S. company chief executives.

After the deal was struck Monday in Atlanta, the administration immediately began briefing members of Congress and select industry and labor advisers who have agreed to confidentiality and can’t share the details with their members or the public. The latest text from Atlanta will soon be available to all members of Congress in a secure room in the Capitol, officials say.

Asked on the Marketplace radio show Tuesday when the text would be made public, Mr. Obama replied, “Soon.”

The U.S. Chamber of Commerce says it plans to “reserve judgment on the agreement pending review of the final text with our members.”

The administration released a report Wednesday showing exports from all 50 states with examples of tariffs that would fall under the deal. The AFL-CIO, a leading critic of the TPP, saw that information as “rose-colored, cherry-picked characterizations,” according to a tweet from Celeste Drake, a trade policy specialist at the labor federation.

A spokesman for U.S. trade representative Mike Froman said his office is “in the process of completing the text for public review and have begun releasing sector-by-sector and state-by-state details on the 18,000 tax cuts on U.S. exports in TPP.”

“People want to see the text, and I think when more details are out you’ll actually see a groundswell of support,” said Chris Padilla, a former U.S. trade official who is vice president of government and regulatory affairs at International Business Machines Corp. “The administration needs to do that very quickly because there is a window that’s open right now but it won’t be open much longer.”

Tech companies, Hollywood studios, transportation firms and some farm associations have backed the deal, but the calculus is more complicated for manufacturers that have to weigh shifting competitiveness in the 12-nation bloc, which includes Japan, Australia, Canada, Mexico and Vietnam.

“We don’t have access to any of the tariff information in any detail, in any of the manufacturing sectors that we all represent,” said Linda Dempsey, vice president of international economic affairs at the National Association of Manufacturers, which has some 250 board members and 14,000 members total.

For months, Democratic critics of the TPP have demanded more transparency, including publication of the negotiating text. But many companies and allied Republicans in Congress are now the ones pressing for more.

The fine print matters to key members of Congress, including Rep. Paul Ryan (R., Wis.), chairman of the House committee that oversees trade. “I am reserving judgment until I am able to review the final text and consult with my colleagues and my constituents,” said Mr. Ryan. Other top lawmakers also want more details before weighing in.

While the TPP is complicated, other countries have released details, and Japan has published information on how it would affect tariffs and quotas in sensitive industries such as dairy, rice and cars. But most of the information is available only in Japanese.